Once again the Dollar has forged a fresh higher high and that pulse up is largely the result of favorable US scheduled data yesterday, expectations of favorable US scheduled data ahead and lastly because of the Fed statements that suggested they could hike rates in the face of current inflation readings! Apparently a private jobs report yesterday improved the macro-economic view toward the US and that in turn has fostered ongoing flows toward the Dollar which is also being lifted by the Feds view of ongoing weakness outside of the US. The Dollar will be presented with Challenger Job cuts, Initial claims, a New Housing price index and a consumer credit report. Expectations call for a slight decline in claims and that should be enough to leave the Dollar in an upward motion. Up-trend channel support in the Dollar comes in at 91.97 but that support line rises to 92.24 on Friday.
Technical Outlook: The rally brought the market to a new contract high. The daily stochastics gave a bearish indicator with a crossover down. Daily stochastics turning lower from overbought levels is bearish and will tend to reinforce a downside break especially if near term support is penetrated. The market’s close above the 9-day moving average suggests the short-term trend remains positive. Market positioning is positive with the close over the 1st swing resistance. The next downside target is now at 91.61. The market is approaching overbought
levels with an RSI over 70. The next area of resistance is around 92.52 and 92.82, while 1st support hits today at 91.92 and below there at 91.61.